Laos considering the adoption of a CBDC, partners with Japanese startup

Laos has been actively involved in the crypto sphere. There are plenty of countries inspired by the recent adoption of Bitcoin by El Salvador. President Bukele also made mining of Bitcoin legal. This mining will take place in farms operating on electricity generated through volcanic power. In a similar fashion, Laos has also allowed the mining of Bitcoin in the country to over 6 firms.

Bitcoin adoption is gaining ground in the country as the government has shifted its focus on launching a Central Bank Digital Currency or CBDC. In an intriguing announcement, the Bank of the Lao People’s Democratic Republic has shaken hands with the Japan International Cooperation Agency.

This government is currently looking to expand in the blockchain sphere. There are talks involving the digital kip, the local currency of Laos.

Soramitsu to analyze the situation

For a better understanding of the blockchain industry and the usage of CBDCs, the government has teamed up with Soramitsu. Soramitsu is a renowned startup based in Tokyo which provides services in the blockchain space. With the involvement of this firm’s expertise and experience, the Laos government looks to build the digital kip.

Soramitsu has partnered with the National Bank of Cambodia and is ready to develop a payment gateway called Bakong. The crypto startup worked with the government of Cambodia to reduce the financial dependency on the US dollar. Within the initial six months of this platform, around 5.9 million users registered on the platform. 

Laos following China

China and Laos have good trading relationships. Therefore, it can be concluded that the latter’s financial authorities are looking to follow China’s footsteps as it launched the digital yuan.

The monetary authorities in the nation believe that a CBDC is a key to solve all money-related issues of the country like inflation. The rising inflation in the nation due to Covid-19 has got the regulators worried. They feel that a CBDC might improve the situation.